Universe Group wins contract extension, hikes profit expectations

Retail management and payment systems provider Universe Group announced a five-year extension of an existing contract with a major, unnamed international oil and gas group for the provision of loyalty services across Europe on Wednesday.

The AIM-traded firm said the material extension provided further visibility over future revenues, adding that it was “encouraged” by progress on its separate material project for another existing customer as announced on 21 December, which was currently in the pilot stage.

Subject to completion of its audit, the company said it was expecting to report revenue for the year ended 31 December in line with the expectations it set in December, with revenue for the second half expected to be in line with that of the first half.

However, the board said adjusted EBITDA and profit before tax were now expected to be ahead of its previous expectations.

The group said it was also in discussions around a temporary extension of its borrowing facility to support any potential increase in working capital requirements during the course of its ongoing projects.

“Covid-19 profoundly affected many aspects of our daily lives in 2020 and remains with us still,” said chief executive officer Jeremy Lewis.

“The retail sector felt the impact and so we are pleased to have navigated the pandemic challenges of last year as well as we did.

“Furthermore, it is very encouraging to see our major retail partners renewing their multi-year relationship with us now, a good indication of our standing as their managed service provider of choice.”

Universe Group said it would release its audited results for the year ended 31 December in the final week of April.

At 1427 BST, shares in Universe Group were up 17.02% at 5.5p.